Press releases

Legal & General launches Retirement Interest Only Mortgage

10 Sep 2020

Legal & General has today launched a Retirement Interest Only (RIO) mortgage providing even more options for those hoping to use their homes to make the most of their retirement.

Retirement has changed rapidly in recent years, with people living and working for much longer, and the coronavirus pandemic has forced many people to reassess their plans. Increasingly, people are requiring a range of diverse financial solutions to fund their needs over the course of their retirement.

For many older people, their home is their most valuable asset and our research shows that there is upward of £1 trillion worth of equity in the housing stock of older home owners.*

Legal & General’s RIO is an interest-only mortgage designed for those aged 55 and over with an interest rate which is fixed for the duration of the mortgage. It can be used to replace an existing interest-only mortgage, to remortgage your home or to purchase a new home. The RIO allows homeowners to borrow up to 60% of the value of their homes to help them achieve their ambitions, whether that’s to improve their home and garden, to support their children and grandchildren or to boost their retirement income.

The amount that can be borrowed will be based upon an affordability assessment, looking at a borrower’s household income and outgoings, to make sure they can keep up payments, both now and at the point they are no longer working, if they are not already retired. Every month borrowers will pay the interest due on the balance of their mortgage, helping long-term financial planning.

Claire Singleton, CEO of Legal & General Home Finance: "People’s needs in retirement are evolving and are more varied than ever. This has never been more true than now, as we find ourselves dealing with the reprecussions of lockdown and the coronavirus pandemic. It is therefore really important that we offer a range of later life lending options, which allow people to make the very best of their own retirement.

A Retirement Interest Only mortgage provides people with the opportunity to access funds from their home, while being reassured they can anticipate the long-term costs and impact on their income and assets. Combined with our range of lifetime mortgages, which includes options for people to pay monthly interest and to use their equity to pay an income, our Retirement Interest Only mortgage means we can offer customers the wide range of options they require."

A RIO only has to be repaid from the sale of  the home when the borrower, or the remaining borrower (if the mortgage is in joint names), dies or moves out of the home into long term care. However, if borrowers decide  to repay the mortgage they can do so at any time, but may need to pay an Early Repayment Charge.

The information contained in this press release is intended solely for journalists and should not be relied upon by private investors or any other persons to make financial decisions. 

*Last Time Buyers Report

The Retirement Interest Only Mortgage is available to people over 55. It’s a loan secured against the value of their home. Interest is paid each month. The loan isn’t repaid until the last remaining borrower dies, or mores permanently out of the home and into long-term care.

As a last resort, the home may be repossessed if the borrower does not keep up with payments.

If you gift the money away, you may need to pay inheritance tax in the future.

Further information

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Millie Hyde-Smith

Director of PR and Content

Legal & General Retail

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Robbie Steel


T: +44 7903 260 560

Email Robbie Steel

Notes to editors

Established in 1836, Legal & General is one of the UK's leading financial services groups and a major global investor, with £1.2 trillion in total assets under management1 of which 40% is international. We have a unique and highly synergistic business model, which continues to drive strong returns. Legal & General provides powerful asset origination and management capabilities directly to clients, which also underpin our leading retirement and protection solutions. We are a leading international player in Pension Risk Transfer, in UK and US life insurance, and in UK workplace pensions and retirement income. Our purpose is to improve the lives of our customers and create value for our shareholders. Through inclusive capitalism, we are investing in long-term assets, such as real estate and infrastructure, that can help build a better society for the future.

1Data as at 31 December 2023.

Legal & General Retail Retirement’s mission is to help its customers lead longer, healthier, happier lives. We believe everyone should be able to have a ‘more colourful retirement’. The Division comprises the Group’s retirement savings and income, later life lending and care solutions businesses. In 2020, LGRR wrote £910 million of annuity premiums and issued £791 million of lifetime and retirement interest only mortgages.

*at 31 Jun 2021